Some state officials have said that TML is “advocating” for
cities to increase their voter-approval tax rates from 3.5 percent to 8
percent. Is this true?
Unequivocally not. The League has reported on the plain language
of a new statutory provision enacted by S.B. 2, which gives city councils the
discretion to direct their designated officer or employee to calculate the
voter-approval tax rate at eight percent if the city is located in an area
declared a disaster area by the governor or president. At this point, the
League is unaware of any legal guidance from the state’s attorney general, or
elsewhere, that indicates this disaster calculation provision has not been
triggered. If such guidance is released, we will pass that information along to
our membership as quickly as possible.
Local leaders are looking for guidance on the budget and tax
rate adoption process, as city budgeting kicks into high gear this summer. To
assist, we have submitted to our membership, in response to numerous
inquiries, the most reasonable reading of the statute. We have not,
however, advocated for cities to take any particular action with regard to
their tax rate, and certainly haven’t encouraged cities to increase their
voter-approval tax rates to eight percent, or by any amount. In fact, in the
only guidance we have released on the disaster calculation provision back on
March 19, we attempted to make this point clear:
“To be clear, the League takes no position on whether a city
should or should not use the higher voter-approval rate calculation allowable
in a disaster. Each city is different and will need to make that decision based
upon any number of factors, such as the impact of the COVID-19 virus on other
sources of local revenue, like sales taxes, the amount of city expenditures
made in response to the emergency, as well as the ability and willingness of
local taxpayers to potentially pay a higher tax rate.”
In recent weeks, some cities have considered resolutions to
calculate the voter-approval tax rate at eight percent. Some city councils have
adopted these resolutions, others have rejected them. The League supports the
ability of all city leaders to decide on tax rates for their communities,
whatever that decision might be.
Where can I find archived issues of the TML Coronavirus Updates?
TML Coronavirus Updates are archived by date here and by subject here.